Legislators Increase Cigarette Tax

Governor Signs Legislation into Law

 

With a $500 million dollar budget shortfall looming large, legislators increased the state’s tax on cigarettes to $0.60.  House Bill 144 passed the House on Wednesday and Senate on Friday morning.  The effective date of the act is March 31, and budget estimates are that the increase in the tobacco tax along with a 6 percent increase in the tax on packaged liquor will raise between $140 and $170 million.

 

With the budget shortfall situation worsening daily, Governor Steve Beshear signed the bill into law the same it passed..  That’s also the reason the legislature acted so swiftly – passing House Bill 144 and companion budget reduction legislation in the first 13 days of a 30-day legislative session.

 

Passage of the tax achieves the intent of a KMA House of Delegates resolution, and potentially improves the health of Kentuckians by reducing the number of smokers, particularly among young people.  The KMA Committee on State Legislative Activities had designated raising the tax as the Association’s priority for the 2009 Kentucky General Assembly.  KMA will likely continue efforts in future sessions to raise the tobacco tax further because of the health benefits of doing so.  KMA thanks those legislators who voted in favor of increasing the tax on tobacco products.